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Cingular 3G Deal Bodes Well For Telecom Gear Suppliers.(INTERNET & TECHNOLOGY)
Byline: MIKE ANGELL
The shaky telecom gear industry got some good news Tuesday: Cingular Wireless is ready to upgrade its high-speed wireless network.
That means by the end of next year, U.S. consumers will have more access to the kinds of advanced cellular networks once only available in Asia and Europe.
As Cingular and others move to these new third-generation, or 3G, networks, telecom equipment makers could see their fortunes rise.
Cingular, co-owned by SBC Communications and BellSouth, is expected to spend $1.5 billion over two years on the upgrade to 3G.
Siemens, L.M. Ericsson and Lucent Technologies all received portions of the upgrade contract. Split between those three suppliers, the deal provides only $50 million to $80 million in quarterly revenue each. But it could put them in a good position to supply future 3G upgrades.
The U.S. is "the largest market globally and Cingular the largest wireless network," said Berndt Baumgartl, president of the mobile division for Germany's Siemens. "It's a significant win for those companies chosen and a major loss for those that weren't."
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